What's the basis for sending regulators to jail? Will you send cops to prison when crimes happen, because they failed to prevent them? This is somewhat of a pre-cog/ Minority Report dilemma. I think law makes a reasonable distinction between crimes of commission and crimes of omission. Proving motive and intent are important parts of the judicial process. Madoff intended to defraud.
You can prevent a person with malicious intent from causing further damage by imprisoning them. You 'deter' people who commit crimes of omission by keeping them away from whatever they proved incompetent at (debar lawyers, de-license doctors and regulators, fire engineers, etc.)
You can prevent a person with malicious intent from causing further damage by imprisoning them. You 'deter' people who commit crimes of omission by keeping them away from whatever they proved incompetent at (debar lawyers, de-license doctors and regulators, fire engineers, etc.)